In January 2025, the Asian vinyl chloride monomer (VCM) market witnessed a period of declination as sluggish downstream demand and fluctuating upstream costs shaped price movements. The softening trend in the VCM market was largely influenced by the broader polyvinyl chloride (PVC) sector, which displayed mixed pricing patterns amid fluctuating crude oil prices and weakening futures markets.

During the latter half of January, VCM prices remained stable, with manufacturers maintaining production levels in the line of subdued downstream procurement. Although some market players attempted to raise prices earlier in the month, mid-week fluctuations in crude oil prices and weaker futures performance hindered any sustained price increases. Additionally, steady calcium carbide prices offered some cost support, preventing a sharp decline in VCM quotations. However, with downstream industries gradually slowing operations ahead of the Chinese New Year, market activity remained muted.

The PVC sector, the primary downstream market for VCM, experienced a volatile pricing landscape. Early in the month, PVC prices exhibited slight upward momentum. However, as mid-January progressed, a lack of fundamental support and crude oil price declines resulted in weaker PVC futures, subsequently pulling down spot prices.

Market participants reported that before the holiday, downstream procurement was primarily spot-based, with buyers showing limited enthusiasm for high-priced goods. Additionally, demand contraction due to seasonal factors further contributed to the lackluster trading environment in the regional market. Some traders attempted speculative pricing adjustments, but overall, the fundamentals remained weak, limiting any potential upward movement in VCM prices.

As the market transitions into February, VCM prices are expected to remain largely stable, with a potential for slight downward adjustments depending on post-holiday demand recovery. Historically, PVC demand rebounds slowly following the Chinese New Year, as industrial activities resume gradually. With market sentiment cautious, buyers are likely to adopt a wait-and-see approach in early February before committing to large-scale purchases.

Moreover, crude oil price trends will play a crucial role in influencing overall cost dynamics. If oil prices stabilize, VCM prices may remain steady. However, any sharp fluctuations in crude oil could trigger corresponding movements in feedstock costs, potentially impacting VCM pricing.

Another factor affecting VCM's short-term trajectory is the state of the PVC market. Given that January ended with a soft demand environment, the outlook for February will heavily depend on how quickly infrastructure and construction projects regain momentum in the APAC region.

As per ChemAnalyst, a cautious trading environment in February 2025 is anticipated, with muted activity in the first half of the month. Unless a stronger-than-expected recovery in PVC demand emerges post-holiday, VCM prices are likely to remain under pressure. The market will continue to monitor key factors such as crude oil price movements, infrastructure spending trends, and downstream procurement activity to assess the trajectory of VCM pricing in the coming weeks in the APAC market.